The Utility Regulator is today publishing our latest Cost and Performance Report for NI Water, which reviews their performance in 2015-2016, the first year of the company’s third regulatory price control PC15. The report outlines our independent assessment of how the company performed against the efficiency targets and key performance indicators outlined in the PC15 Monitoring Plan for 2015-2016.
We are pleased to report that NI Water has largely delivered on the annual targets set in the PC15 monitoring plan for the first year of PC15. PC15 is a six year price control covering the period 2015-2016 to 2020-2021. It is clear from assessing the 2015-2016 data that in overall terms, the company outperformed its operational expenditure (opex) efficiency target, while at the same time improving overall levels of service.
Our key findings are as follows:
· NI Water’s £197.1m of opex spend in 2015-2016 compares favourably to our regulatory allowance of £199.6m (in current prices), a difference of some £2.5m in-year.
· The company invested £143.7m of capital expenditure (capex) in 2015-2016, the first year of a six year price control. Investment was constrained by the available public expenditure budget and we worked with NI Water, Department for Infrastructure and other key stakeholders to ensure that the company delivers the best possible package of outputs within the funding available. We will continue to assess cumulative delivery over the medium term, taking account of changes in budget, inflation and the delivery of capital efficiency.
· NI Water met our 2015-2016 overall performance assessment (OPA) target, delivering its highest ever OPA score.
· The company met or exceeded planned delivery in all but four of the key performance indicators (KPIs) set in the monitoring plan for 2015-2016. This includes 14 out of 16 consumer service measures and all of the water and sewerage quality KPIs. It delivered the majority of the output measures and maintained stable serviceability.
· Delivery of development objectives is a key requirement for NI Water in PC15 and the company has further work to do to demonstrate that it is making sufficient progress in the delivery of all of these objectives for PC15.
Where appropriate, we have also compared NI Water’s performance with companies in England, Scotland and Wales.